Twitter just experienced a nightmare Q1 earnings scenario.
The company missed Wall Street revenue targets and had to cut back its full year financial forecast. What’s more, the earnings were leaked early, apparently because the results were accidentally posted on Twitter’s investor relations website.
But there’s more bad news.
During Twitter’s conference call with analysts it revealed that its user growth was not growing as fast as it would like in the current quarter.
Twitter’s user growth has been one of the major worries on Wall Street, with advertisers fretting that the service’s mainstream appeal may not be as strong as rival mobile and social services such as Instagram and WhatsApp.
Twitter added 14 million new monthly active users in the first three months of the year, which was one of the few bright spots in its earnings report.
But when asked by an analyst if MAUs were expected to grow by 13 million to 16 million users a quarter going forward, Twitter executives had some bad news.
“At this point our visibility is limited as it relates to Q2 MAU adds,” said CEO Dick Costolo. “We’re off to a slow start in April.”
The weak MAU outlook seems to have further soured investors. Twitter’s stock plunged about 18% in regular trading after the earnings report leaked. But the stock had been up slightly in after-hours trading as the company kicked off its conference call.
Shortly after the MAU comments though, Twitter’s stock was down about 2% in after-hours trading.